Amazon.com Inc. will launch a subsidiary called A9.com Inc. that will develop technology designed to help consumers search for products online and make better and more informed buying decisions, a spokeswoman for A9.com said Thursday.
Scheduled to launch in October, A9.com will be fully owned by Amazon.com but it will be operated independently and branded separately from its parent, said Alison Diboll, founder and president of Diboll & Associates Marketing and Public Relations.
A9.com, which will be based in Palo Alto, California, will license its technology to Amazon.com and to other Web sites, she said. At launch, the company will have about 30 employees, a figure expected to rise significantly over time, she said.
While it makes sense for Amazon.com to offer this type of technology to its customers, it's not clear whether it's smart for them to get into the business of developing it, said Rob Lancaster, a senior analyst at The Yankee Group. Developing search technology isn't simple, so it remains to be seen how effective A9.com's offering will turn out to be, he said. Amazon.com could have instead have gone out and acquired the technology, he said.
However, Amazon.com has the money to invest and if the technology is a hit, Amazon.com and its subsidiary will tap into a big market, since this type of service is in high demand from consumers and merchants, he said. Consumers are always looking for good search technology, especially when they're out on the Web planning to buy something. Meanwhile, this technology appeals to merchants because it delivers to their sites Web surfers with an intention to buy a specific product, Lancaster said.
Diboll declined to give details about the search technology A9.com will develop, other than to say it will "improve customers' e-commerce experiences by providing them with the most relevant products" they are looking for. This would include information such as pricing, availability and features, she said. "The company hasn't yet been formed, so we can't comment on the specific nuances of the functionality," she said.
News about A9.com first appeared on Thursday in the online edition of The Wall Street Journal.
Diboll also declined to comment on the competition A9.com will face, but similar e-commerce search services are already available from rivals Google Inc., AskJeeves Inc. and Yahoo Inc.